How is Google managing to generate more revenue from Freemium Apps???
Business is all about strategy, and all the approaches will not be through a conventional way. Who can better understand a customer other than a businessman? From a startup to well-established enterprise people will try every trick in the book to woo their customers, and by hook or crook they will achieve it. A good businessman is one who gains efficiently by losing.
Online business is one such activity which requires unparalleled visibility, so unless the potential customers are aware of your products and services it is not possible to succeed. Strange but it is true, because, people look for things which are more appealing and profitable to them. Even though customers get the initial profit, it is the latter one who will receive more benefits in the further stage.
Strategy beyond Reach – Freemium Model
One of the best examples to exemplify this fact is to have a view on latest updates about Google. It was accounted that 98% of revenue was generated through Google play store. Growth in App and game development process has reached beyond threshold level. So, there will be an obvious rise in the level of competition. So, a good businessman will certainly think of strategies which will help him stand among the crowd.
Google took the strategic approach which is to offer Freemium Apps. Freemium is a process where the company provides game, app or any service for free. But on the latter side, they will charge for any upgrades or other services. The major benefit Google attained from this approach was a major customer base who were used to their services. Once customer base was created, Google started charging them for future version up gradations and other services. One thing to be noted is Freemium is only the partial version of a game or an app, so any further requirement customer will have to pay accordingly.
The term “Free” is like the word fire which attracts large number of moths. It is a traditional method which has the potential to attract a large crowd and where the brand is sure to get maximum visibility. Freemium Apps or services promise to generate more revenue than the regular apps. So, this approach is adopted by almost all of the strategists. Even though Freemium approach is reaching benefits, there are lots of risks to be encountered. For example, you if you come across large number of freeloaders, then there is minimum possibility that your service will be on the same line of benefits.
Is it worth a risk?
Yes, lots of factors are to be considered before one decides to jump into this bandwagon. Also, once you succeed in going over these complications, lot of benefits can be attained. The elements to be focused are,
- Influence- Is your game or app compelling enough to attract more customers
- Resemblance- Yes, always so no to duplication. Because it will sure to repel the interests of your customers
- Time Period- Remember freeloaders will always be there, so make sure that you provide only the minimum version of your development and only for a certain period
- Concept-This is somewhat related to the influence factor. Your ideas should be fresh and alluring
Google has managed to create a benchmark by gaining more revenue through this strategic approach. Freemium is a perfect marketing strategy and developers are gaining more popularity. Not all the ideas get clicked, only the one which is compelling and innovative enough can stand among the rest.